Ocado returns to core profit; pretax loss narrows

The Japanese economy

In Japan, industrial production fell at its fastest pace since May 2020. The index fell 7.5% in January month-over-month (MoM), with output sliding in 14 of the 15 industries surveyed by the Ministry of Economy, Trade, and Industry. Production declined the most in motor vehicles, down 17.8%. This was a major blow for the Japanese economy, as automobile-related production remained strong during a period of weak global demand for goods. Retail sales rose for the 23rd straight month in January by 2.3% year-over-year (YoY), matching the median forecast.

The Japanese yen

The JPY rose overnight on the comment of one Bank of Japan (BOJ) board member. For Hajime Takata, the central bank must consider overhauling its ultra-loose monetary policy, including an exit from negative interest rates and bond yield control.

Australian retail prices

In Australia, retail sales rose by 1.1% in January month-over-month (MoM) after a 2.1% fall in December. Economists had anticipated a 1.5% increase. For economists, the underlying trend in retail sales remains weak, which is the main reason financial markets are confident the Reserve bank of Australia (RBA) rates have reached their peak.

Car production in the UK

UK car production jumped 21% in January year-over-year (YoY), marking the fifth straight month of growth, helped by firm demand and easing supply chain issues. The bulk of the production was for export. Electric-vehicle output rose 4.5% to 29,590 units last month, accounting for 35.7% of the overall production.

German retail sales

Germany retail sales decreased by 0.4% in January MoM, missing expectations of a 0.5% rise. Later this morning, the German unemployment rate is forecast to remain at 5.8%, and at 1 p.m., the consumer price index is expected to increase by 2.6% in February YoY, after a 2.9% rise in January.

US PCE price index

Over in the US, the core personal consumption expenditures (PCE) price index is expected to rise by 2.8% in January YoY, after a 2.9% rise the previous month. MoM data is expected to rise by 0.4%, after 0.2% in December.

The Canadian economy

In Canada, the market awaits growth data for the fourth quarter. The Canadian economy is forecast to have expanded by 0.3% in the October-December quarter, after a 0.3% contraction in Q3.

Ocado

Ocado returned to profit at the earnings before interest, taxes, depreciation, and amortization (EBITDA) level, and pretax loss narrowed to £403 million. Earlier this week, Ocado shares fell after M&S said it was withholding a multi-million-pound payment to Ocado Group after its grocery delivery tie-up failed to meet key performance targets.

Haleon

Haleon posted a 4.1% rise in revenue to £11.3 billion. Adjusted operating profit increased by 10.4%. Adjusted operating profit margin: 22.6%, up 50 basis points. IAG reported adjusted net income of €2.65 billion. Operating profit came in at €3.5 billion, in line with expectations.

HP

HP shares fell 3.8% in extended trading after missing revenue expectations. Earnings per share came in line with the forecast at 81 cents. Revenue reached $13.2 billion, falling for a seventh straight month and missing the forecast of $13.57 billion as demand for personal computers remains sluggish. HP forecast second-quarter adjusted profit per share between 76 cents and 86 cents, the midpoint of which is in line with estimates of 81 cents.

Snowflake

And watch out for Snowflake at the open this afternoon in the US. Snowflake is not an all-session stock on the IG platform. Its shares plunged more than 20% in extended trading after forecasting first-quarter product revenue below Wall Street estimates. Investors ignored completely the fact that earnings and sales beat expectations. Adjusted profit per share came in at 35 cents, also beating the estimate of 18 cents. Total revenue was $774.7 million, beating analysts' estimates of $759.3 million.

Best Buy

There are a few quarterly reports on the menu today, among them Best Buy. The electronics retail industry is forecast to post earnings of $2.52 per share on revenue of $14.56 billion. Dell Technologies is also due to report. The street anticipates earnings of $1.73 per share on revenue of $22.16 billion.

Crude oil

On Wednesday afternoon, environmental impact assessment (EIA) weekly inventories confirmed what the Application Programming Interface (API) announced the previous day: a rise in crude stocks and a drop in refined products. Crude Oil inventories rose for the fifth consecutive week, increasing by 4.2 million barrels. Gasoline stocks fell for a fourth consecutive week, decreasing by 2.8 million barrels, while distillate stockpiles were down by 500,000 barrels.